Old Debt Collections

Looking for a Credit Card for Christmas Shopping? Before you submit a credit card application, first review the main points which will help you choose the right credit card for your needs.

What Charges You'll Make - If you're going to use the credit card mainly for booking airline reservations and hotels, it might be best for you to get a travel credit card that offers sky miles and hotel points or cashback. If this will be an emergency credit card only, then your main concern may be for a low interest rate credit card with low fees.

When You'll Repay Charges - Will you pay off credit card charges in full every month, or will you carry a balance month to month? If you're going to carry a balance, you want the lowest possible interest rate as well as a low introductory rate. But if you'll payoff balances in full every month, then interest rate really doesn't matter so no annual fee and/or a long grace period would be a bigger concern. If you're going to carry a balance, be concerned about how the finance charge is calculated. The most common method is the Average Daily Balance, which means that the daily balances are added together and then divided by the number of days in the billing cycle. Stay away from credit cards that compute the balance using two billing cycles, as this method costs more money in financing fees.

What Amount You'll Charge - If you're going to use the credit card for all your monthly expenses, then you need a card that has a high credit limit and a high cashback percentage.

More info about Interest Rates, Credit Limits, Incentives, Fees and Penalties

Interest Rates - The interest rate (Annual Percentage Rate) APR can either be a fixed rate or a variable rate that is tied to another financial indicator, most commonly the prime rate. With a fixed rate credit card you know what the interest rate will be every month, whereas a card with a variable rate can fluctuate. Of course, even the interest of a fixed rate card can change based on certain events, such as paying your credit card bill late, exceeding your limit, or simply because the credit card issuer decides to change it after providing you ample advance notice.

Credit Limit - This is the amount of money the credit card company will let you charge to the card. This amount varies depending upon the card offer and your credit history. Be sure to get a credit card with an ample limit, because getting close to your max can hurt your credit score. Just remember that you don't have to max out your limit just because it's available.

Incentives - To compete for and to gain customers, many credit card companies offer rewards. Even if you normally use cash, why not use your credit card and then use the cash to make the payment during the grace period? You still won't pay interest and meanwhile you'll rack-up rewards. A credit card with 5% cashback will earn you $5 for every $100 charged. If your total bills come to $2,000 per month, you'll earn a free $100 every month. Look for a rewards program that you'll use and which offers flexibility, such as cashback or travel.

Fees and Penalties - Compare common charges such as late fees, overlimit fees, balance transfers, cash advances, and for making payments by telephone. Regarding balance transfers, look for credit card offers with no transaction fees and zero percent interest for at least 12 months.

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Old Debt Collections

By Credit Federal | Published 10/21/2008

Are old debt collections resurfacing? Zombie Debt Collectors will try to get you to payoff old obligations like credit card debt. Learn how to respond, debt statute of limitations and your rights.

Fighting Old Debt Collection Attempts from Zombie Debt Collectors

Definition of Zombie Debt: old debt purchased by debt collectors with the goal of intimidating borrowers into paying off the debt. If a collection agency contacts and harasses you about an old debt, don't surrender the money immediately. There are debt collection rules and you have rights.

Right #1: The Fair Debt Collection Practices Act (FDCPA), gives you the right to make debt collectors verify debts. Within 35 days of being contacted by a debt collector, you can send a letter requesting the collector to validate your debt. The validation needs to include some documents from the original creditor proving you owe the debt, that the amount you owe is valid, and that the agency is allowed to collect the debt from you. Your request for validation must be made in writing and should be sent via certified mail with return receipt requested.

Right #2: Statute of Limitations on debt is the maximum time the debt collector can pursue repayment from you through the court system. However; although the statute of limitations has expired, collectors may still call you or may even file suit against you in court. To stop their calls, send a cease and desist letter to the collector. If the collector files suit against you, you must attend the hearing and prove that the statute of limitations on the debt has expired.

Right #3: Cease and Desist request to ask the collector to stop contacting you. By sending a written cease and desist letter to the debt collector you can have the collector stop communicating with you about the debt altogether, regardless of the legitimacy of the debt. Such a letter should be sent via certified mail with return receipt requested. If the collector violates this request, you can take legal action. But keep in mind, a Cease and Desist does not relieve you of the debt.

Right #4: Credit Report Dispute. If you requested the collection agency to validate the debt and the debt is still in the 30 day validation period or the collector has failed to respond to the request altogether, the collector cannot legally add the debt to your credit report. In either case, you can have the account deleted from your credit by submitting a credit report dispute. The case for the dispute is stronger if you include a copy of your debt validation letter along with the certified and return receipt requests to show the collector's failure to respond and/or to validate the debt.

Other: Even if you owe the debt...
You may be able to negotiate debt payoff. Sample debt negotiation letter.
The collection agency cannot put you in jail.

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Old Debt Collections - by <a href=http://creditfederal.com>CreditFederal.com</a> <div style="text-align: left; font-family: Verdana;">Are old debt collections resurfacing? Zombie Debt Collectors will try to get you to payoff old obligations like credit card debt. Learn how to respond, debt statute of limitations and your rights. Fighting Old Debt Collection Attempts from <a target='_top' href="http://creditfederal.com/article/articles/139/1/Zombie-debt-collectors">Zombie Debt Collectors</a> Definition of Zombie Debt: old debt purchased by <a target='_top' href="http://creditfederal.com/article/articles/287/1/Unknown-Debt-Collection-Agency">debt collectors</a> with the goal of intimidating borrowers into paying off the debt. If a collection agency contacts and harasses you about an old debt, don't surrender the money immediately. There are <a target='_top' href="http://creditfederal.com/article/blogs/1/Collection-Agency-Rules-and-How-to-Respond-to-Harassment">debt collection rules</a> and you have rights. Right #1: The Fair Debt Collection Practices Act (FDCPA), gives you the right to make debt collectors <a target='_top' href="http://creditfederal.com/article/articles/555/1/Debt-Collector-Verification">verify debts</a>. Within 35 days of being contacted by a debt collector, you can send a letter requesting the collector to validate your debt. The validation needs to include some documents from the original creditor proving you owe the debt, that the amount you owe is valid, and that the agency is allowed to collect the debt from you. Your request for validation must be made in writing and should be sent via certified mail with return receipt requested. Right #2: <a target='_top' href="http://creditfederal.com/article/articles/508/1/Statute-of-Limitations-Debt-Collection-Act">Statute of Limitations on debt</a> is the maximum time the debt collector can pursue repayment from you through the court system. However; although the statute of limitations has expired, collectors may still call you or may even file suit against you in court. To stop their calls, send a <a target='_top' href="http://creditfederal.com/article/articles/19/1/Letter-to-Stop-Credit-Collector-Calls">cease and desist letter to the collector</a>. If the collector files suit against you, you must attend the hearing and prove that the <a target='_top' href="http://creditfederal.com/article/articles/479/1/Debt-Collection-Statute-Of-Limitation">statute of limitations</a> on the debt has expired. Right #3: Cease and Desist request to ask the collector to stop contacting you. By sending a written cease and desist letter to the debt collector you can have the collector stop communicating with you about the debt altogether, regardless of the legitimacy of the debt. Such a letter should be sent via certified mail with return receipt requested. If the collector violates this request, you can take legal action. But keep in mind, a Cease and Desist does not relieve you of the debt. Right #4: <a target='_top' href="http://creditfederal.com/article/articles/184/1/Credit-report-accuracy-and-disputes">Credit Report Dispute</a>. If you requested the collection agency to validate the debt and the debt is still in the 30 day validation period or the collector has failed to respond to the request altogether, the collector cannot legally add the debt to your credit report. In either case, you can have the account deleted from your credit by submitting a credit report dispute. The case for the dispute is stronger if you include a copy of your debt validation letter along with the certified and return receipt requests to show the collector's failure to respond and/or to validate the debt. Other: Even if you owe the debt... You may be able to <a target='_top' href="http://creditfederal.com/article/articles/553/1/Debt-Collection-Agency-Negotiation">negotiate debt payoff</a>. Sample <a target='_top' href="http://creditfederal.com/debt-negotiation-letter.html">debt negotiation letter</a>. The <a target='_top' href="http://creditfederal.com/article/blogs/247/Can-Debt-Collectors-Put-Me-In-Jail">collection agency cannot put you in jail</a>. </div> This article provided courtesy of <a href=http://creditfederal.com target=_new>www.CreditFederal.com</a>, a personal credit resource of good or bad credit credit cards and loans.

Credit Tip: Need a high limit for Christmas credit card charges? If you have bad credit, consider a personal loan by refinancing your mortgage. Even if you have cash to buy Christmas presents, we recommend using a prepaid card to make purchases because it's safer than carrying cash.